Voltas: 4QFY26: Earnings miss on margin pressure

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Voltas: 4QFY26: Earnings miss on margin pressure

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Voltas

4QFY26: Earnings miss on margin pressure

Reiterate Rating: BUY | PO: 1,450 INR | Price: 1,294 INR

Earnings miss on margin contraction 15 May 2026

Voltas’ recurring earnings declined 52% YoY (53/55% miss on BofA/street estimates). Equity

Revenue growth slowed down to 2.5% YoY on a strong base of last year, while EBITDA

margins contracted 247bps YoY led by significant margin contraction seen in the UCP

Key Changessegment on the back of commodity inflation and currency depreciation.

(Rs) Previous Current

2026E Rev (m) 142,005.0 142,445.0UCP: Margins key drag, price hikes expected

The ongoing West Asia conflict has led to supply chain disruptions resulting in volatility 2027E Rev (m) 162,010.5 163,649.1

in raw material availability and logistics impacting margins significantly in Voltas’ UCP 2028E Rev (m) 185,287.4 186,924.9

segment. The company has already taken two price hikes – (i) 7-8% on account of BEE 2026E EPS 15.86 11.99

rating change and (ii) 1-2% on account of commodity pressures (before the start of the 2027E EPS 26.10 23.11

conflict) and expects to take another price hike (likely double-digit) on account of input 2028E EPS 34.20 33.37

cost increase because of the conflict. Impact of BEE rating change led price hikes was

softened due to GST cuts, and management believes further price hikes would not lead Amish Shah, CFA >>

Research Analyst

to affordability challenges impacting demand in case of a strong summer and remains BofAS India

focused on strong topline growth for margin revival. However, margin revival (to FY25 +91 22 6632 8656 shah.amish@bofa.com

levels) is likely to be gradual. The company indicated that channel inventory has largely

Udit Dhekale >>